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Bernard Madoff, convicted of running an $65 billion Ponzi scheme, was sentenced to 150 years in jail. What’s your take on his punishment?
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Joseph Quinlan, a managing director and the chief market strategist of Bank of America, Global Wealth and Investment Management, joined the firm in June 2003. Quinlan is a leading expert on global capital flows and the transatlantic economy. He has been a senior transatlantic fellow (nonresident) at The German Marshall Fund in Brussels, Belgium, since 2003. His research there centers on regional and global trade and investment flows. As a fellow, he regularly briefs congressional leaders on global economic/financial affairs and has testified before the European Parliament.U.S. businesses are fleeing America and setting up shop in China. The U.S. faces an unfair trade advantage with China. Products made in China and sold in the United States are robbing American companies of business and profits. Sounds right, doesn't it?
Joseph Quinlan, a managing director and the chief market strategist of Bank of America's Global Wealth and Investment Management division, says such opinions may be widely held but are misleading, at best. "The mainland, so goes the consensus, has become the 'Factory to the World,' leaving U.S. workers to flip hamburgers," Quinlan writes in an analysis for investors and clients. "Reality is quite different. ... The $15.5 billion the U.S. has sunk in China this decade equates to only 1.6% of the global total. U.S. FDI in Ireland and Germany was roughly triple the level of investment in China over the same period."
In "The Top 10 Things Every Investor Should Know About U.S.-China Relations," Quinlan also argues that the huge merchandise trade deficit the United States has with China is overly scary looking and overstates the problem. It does not count many goods and services sold by U.S. affiliates in China. What about American businesses losing out to goods made in China? We'll let Quinlan make his case, but you're right if you figure the answer is more complicated than many of us think.
POSTED BY: DD (December 14, 2007 09:43 AM)
These comments make a lot of sense. Everyone plays up the notion that we are in huge amounts of debt, and that we are going to drown in it. This is simply not true. The foreign trade deficit the country is carrying is no larger in percent of gdp than that of 10 or 20 years ago, thus the strain on our financial system is no greater. In addition, the budget deficit is again a singularly small percent of the economic output of the country, although we would all rather have a deficit than a surplus in federal accounts. There is no need to waste money that could be used for investment in the country to sit idle, just to make those of us who do not understand finance, feel better.
It is true that we are losing a large amount of manufacturing, and this is concerning as a strong manufacturing source is important if we ever again get into a large scale war. The country with the greatest manufacturing base usually wins. That being said, Iraq is a small conflict and does not require the type of attention that ww2 did.
I am all for a strong America, but we cannot cry about the past if we are going to be the country of the future. We have to embrace the idea of working smarter, and more efficiently. There are too many of us who now feel entitled to the good life; there are too many victims. Richard, if we are to keep our place in the world we will need to earn it.
POSTED BY: All Roads (December 15, 2007 02:15 AM)
Excellent post. I ahve been writing about many of these same issues for months without anyone paying much attention, so I hope you are able to garner the attention this topic deserves.
R
www.allroadsleadtochina.com
POSTED BY: madmilker (December 17, 2007 10:07 PM)
dang! China go green....when pigs fly! you make 10 points and not say squat! The people in China save 50% of what they make while the whole World expects the American consumer to spend...spend...spend. They already up to 70% of the dang GDP and drowning in debt....and there ain't been one nincompoop the likes of a "Henry Paulson" are a "Ben S. Bernanke" that have stood up and said...."STOP"! Just go to Wal*Marts China web site...they promote the fact that 95% of the items in their China stores come from China and they promote China expor. You don't have to be a rocket scientist to know...if all the US dollars go to China for all that cheap stuff in order to get them back to America....America is gonna have to produce something besides "McDonalds" "Starbucks" "BurgerKing" "Whataburger" and "Chick-fil-A". Oh! for that one poster typing about the debt...how does $48 trillion sound. Check it out on the grandfathers Economic Report web site under total debt.
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